Schumpeter is attractive because he emphasized credit and non bank forms of credit are being innovated; because he emphasized creative destruction and that's what globalized production is doing; and because he emphasized innovation which technoscience is yielding (including new biological products). But innovation is often hype and constrained to profitable activities; destruction is often more than creation, and innovation is not entpreneurial but social through and through (as Schumpeter himself realized). At any rate here is a review I wrote more than ten years ago. I should have added that his embrace of right wing corporatist Catholic doctrine was received by some as a veiled call for fascism, and I agree with Catephores' article on this so called bourgeois Marxist. Of course Schumpeter could write an apologia of capitalism since he considered the losers worthless subhumans.
Marxists, beware any Schumpeter/Marx synthesis! Even if Schumpeter was nice to Sweezy.
Date: Mon, 3 Jul 1995 10:32:07 -0800 Richard Swedberg, 1991. Schumpeter: A Biography. Princeton University Press.
This book has been highly praised and in my opinion unduly so. Its most significant contribution seems to me to be its discussion of Joseph Alois Schumpeter's Weber-inspired conception of *Sozialokonomik*, in particular how Schumpeter attempted to broaden the domain of economics beyond price formation in his work on the tax state, class formation and imperialism. Schumpeter is thus presented as a forerunner of a true social science, a transciplinary economic science. Schumpeter's efforts to synthesize theory, economic statistics and economic history is also touted as one of the great social scientific projects of this century. Schumpeter's methodological contributions are seen as key to his brilliant work on "today's most important puzzles: the role of technology in the economy; how to incorporate social factors into economic theory; and how to develop a truly dynamic theory."
In my opinion Swedberg underestimates the extent to which Schumpeter's work was a severe critique of Marx's theory.
In an interesting footnote, RS does say that it is possible that Max Weber (who read Russian) may have conveyed to Schumpeter Lenin's argument in Imperialism: the highest stage of capitalism before he penned his own famous essay on the matter. And RS also does note that JAS was always inspired by Marx's theorization of dynamics as immanent to the capitalist system.
But the polemical nature of Schumpeter's work is underemphasized; Schumpeter's self-professed scientific detachment is treated with kid gloves, and the work which has critiqued Schumpeter's positivist self-conception (e.g., Manuel Gottlieb, Allen Sievers, Robert Heilbronner and Murray Greene, among others) is either ignored or consigned to short footnotes.
Very disturbing about Swedberg's treatment is how little reflection Schumpeter's vicious statements about various minority groups provokes. After citing some of Schumpeter's comments on various "subnormal" groups, all Swedberg can say is that Schumpeter's universe is "inhuman", and this "lets us understand how Schumpeter must have suffered from having to live in it."
One can safely conclude however that one suffers much more when actually treated as a ... n..g..r(Schumpeter's language is disturbing) than when one merely contemptuously thinks of human beings in such terms, seeing them ultimately, as Schumpeter did, as "the great threat to humanity."
Having already found the secret of profit in supernormal personalities, Schumpeter seems to have substituted the Keynesian theory of subnormal economic activity (an unemployment equilibrium) with diatribe against subnormal people, presumably the beneficiaries of the inflationary Keynesian programs which he maintained were undermining the self-generative capacities of the capitalist mechanism. So it is not surprising that Schumpeter would bring it all together thusly: "Just as the n-word dance is the dance of today, so is Keynesian economics the economics of today."
RS notes that at this point that Schumpeter was mentally out of balance but somehow at the same point RS reminds us of what a monumental achievement the History of Economic Analysis, written at the same time, remains. Moreover, RS himself notes that Schumpter consciously and strategically reminded himself not to express such sentiments openly.
Swedberg does not what to make of Schumpeter's fear of the high birthrate outside of white humanity, especially of Slavic ethnic groups, and Swedberg takes it on JK Galbraith's authority that JAS was not an anti-semite, though Schumpeter was sure that the extent of the Holocaust had been doubled...as if that would still make it less of crime against humanity.
Schumpeter's contempt for ordinary people is also manifest in his assumption that labor radicalism can only be the product of spoiled intellectuals.
Of course Schumpeter was actually drawn to Hitler for his interest in recomposing what Schumpeter saw as a weakened bourgeois class and protecting strata, as evident in Schumpeter's approval of Hitler's promulgation of middle class family values and a pro-savings mentality: Kinder, Kuche and Kirche. He saw Hitler as presenting an opportunity for Catastrophe and Glory, a phrase Haberler told him to change to Catastrophe or Glory. As already suggested, one can only wonder how much of his private diaries and correspondence remain unquoted or ellipsed by Swedberg or Robert Loring Allen. It is not for gossip purposes that this is important; we may be denied insight into Schumpeter's conscious strategic intent in his theoretical work proper.
This may seem to even some Marxists as a politically correct dismissal of someone who did make some great contributions to social science, including of course that monumental history of economics, written as Schumpeter was urging amnesty for NAZI war criminals. That he was one of the greatest hired prize fighters of this century no one can honestly deny, I believe. For example, Robert Heilbronner has shown that Schumpeter's early economic theory was a critique of subjective value theory (or marginalism) mainly in the service of an elite theory of history.
Knocking away at the foundations of contemporary economic ideology can always be done from the Radical Right, something the famous technology historian Nathan Rosenberg also does not recognize as he brackets Schumpeter's reactionary politics and treats Schumpeter's critique of neo-classical economics as a scientific contribution to the understanding of capitalism, instead of what it really was: a reactionary defense of a putatively dynamic and self-regulating "trustified", i.e., monopoly, capitalism whose real contribution to humanity has been the barbarism so manifest in Schumpeter's peculiar "cultured conservativism" as RS puts it or "Schumpeter's curious politics" as Bernard Semmel called it in the Public Interest...of all places.
Rakesh Bhandari